Posted on 03/06/2011 6:27:42 PM PST by Errant
...It was reported that Blythe offered 50 percent premium. That was not even close in our case. We got over 80 percent premium. That's right. Over $50 per contract on the condition that our group sell all our contracts...
These sets of facts from our traders lead us to believe that the paper price of silver may have a difficult time surpassing $36 because if the counterparty at the Comex is so willing to pay north of $50 to dissuade people from standing for delivery yet the paper price of silver is still under $35, then we suspect that losses triggered by derivatives is the main reason for the price suppression of silver. We can see no reason why they would not allow the paper price to go up yet are so glad to pay off the comex contracts to show the world that so few are standing for delivery. In our mind, Comex could default with if as little as 4,000 contracts stood for delivery. We are very curious to see how high the paper price of silver actually trades during this run. Posted by Louis Cypher"
It should now be obvious to all that silver is a fractional reserve system. Just like a fractional reserve bank, when there is more demand for the actual underlying good (i.e. silver or money) than there is a real physical supply for, it's called a "run on the bank". Those who get in line first, get their silver. Everyone else will end up as an "unsecured creditor", holding a worthless piece of paper when the music stops.
(Excerpt) Read more at marketoracle.co.uk ...
Are you suggesting silver will go to $15?
Well, I’m old enough, smart enough, and been wrong enough I’m not about to say something is impossible.
But I suspect $15 silver has gone the way of the Sabre Toothed Tiger and the Stegosaurus.
Estimates about how much silver there is vary. Usually they start at the bottom end at about 1 billion ounces.
Top end comes in at around 6 billion ounces.
If we are liberal and go with the 6 billion figure, that amounts to about 1 oz per person on Earth.
And 6 billion ounces could be had/controlled at 15 dollars an ounce with 90 billion dollars.
Now, 90 billion dollars sounds like (and it is) alot of money. But in fact it’s less than one tenth of a trillion dollars. And to the fund managers, the derivatives markets, the venture capitalists, it’s small fry, these guys probably have 90 billion in change in their couches!
I’ve read estimates that the total face value of all the hedge fund contracts and derivatives markets adds up to:
250 quadrillion dollars.
That’s 250,000 trillion dollars.
If you ever see $15 silver again, back up the truck. Then go out and beg, borrow, or steal another truck!!
I remember an ad that Colt had in the mid 1970’s, it went something like this: In 1873 you could by a new colt Peacemaker with a 20 dollar gold piece, today you still can.
Matter of fact silver was at $10 and oil at $29 circa February 2009 at the trough of the deflation.
If you have 2,000 pieces to sell, why not parcel out say 200 pieces and sell them on E-Bay this month, after repricing them for silver. You can even price them a little less becasue your markup is already quite good.
Then resolve to sell another 200 pieces in April,etc.
You can spread your sales over the next ten months, priced accordingly to the way the market goes.
I would keep a certain percentage of the jewelry held in reserve as a personal investment. The silver if it can be melted( not plating)like sterling, is already worth almost 10 times what you paid for it as a raw material, and can be a good hedge for you if silver really goes through the roof.
Someday you will tell your grandkids that oil was $29
They’ll look at you and say “Yeah, yeah. And next thing you’re going to talk about is that Tooth Fairy thingie...”
;-)
I’ve seen an article where a large amount of silver is used in electronics, and that it is not econmically feasible to reclaim that silver until silver reaches $ 50.00/oz.
Also, it is becoming very evident that supply is not reaching demand, the pace of which is being set by China and India, as they need silver for -—get ready-—electronics production-— and for strategic materials stockpiling.
As long as you have all the essentials (e.g. food, protection, clothing and such) taken care of for an extended period, I'd only sell or barter when I needed something.
Chances favor higher inflation and declining value of the dollar. You're ahead of the game if you own something with real value that is likely to also increase in value compared to the dollar.
Yes, JPM is JP Morgan, or The JP Morgue as many like to say. They’re not just making Blythe look bad, they’re making JPM face hundreds of millions of dollars in losses for every dollar silver trades higher. I think Wynter calculated that if silver gets to $70 or $80 or so, JPM would be insolvent, just from silver losses (arising from an enormous short position). JPM isn’t paying COMEX the premium, they’re paying it to Wynter’s traders for agreeing to take fiat instead of silver, for their contracts that they bought and paid for fair and square. (Again, so the story goes.) I think they held something like a few thousand contracts, which by the way at $35 silver cost $175 grand each.
Check your Freepmail :)
The Sprott silver fund (PSLV ) remains at a high premium of 18.4% to NAV. I guess this is the real price of physical silver.
The Sprott gold fund (PHYS) has a premium to NAV at 6.00%. This number is beginning to rise as investors clamor for real metal.
http://harveyorgan.blogspot.com/
Not only that, but silver is involved in lots of new and cutting edge technologies, particularly in medicine. With the graying of the Boomers, there’s ya another big sink.
Hell, they’re incorporating it into fabric to eliminate BO. Man, if that catches on, imagine the market in Paris and Riyadh!!
NAV=Net Asset Value
What makes you think people in Riyadh desire to smell any differently than they do?
“”The Sprott silver fund (PSLV ) remains at a high premium of 18.4% to NAV. I guess this is the real price of physical silver.””
Which would make physical $42.81 at this moment.
Well surely............. no...... yer prolly right.
Then again, maybe Wynter’s people had just a few 100s of contracts, because I recall reading that they were funded with tens to hundreds of millions of dollars, but not billions. A thousand contracts would be $175 million, which might be more than their bank was. Actually a little less since they bought below $35 silver.
I'm willing to risk personal capital on that assumption.
Here's another thing I'm willing to risk personal capital on:
mark
I’ve been looking into uranium as well. Not ready to kick that off yet though.
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